The current international payments regime is structurally unequal because most countries cannot settle cross-border transactions in their own currencies. They must first obtain reserve currencies, especially US dollars, through exports, capital inflows, or borrowing. This creates exchange-rate vulnerability, reserve pressure, and a “double cost” of net imports that contributes to sovereign indebtedness, austerity, unemployment, and dependency on export-led growth. The stakes are therefore not only monetary but political and social: countries lose policy autonomy, poverty deepens, and development strategies remain constrained by external financing needs rather than domestic priorities. A Clearing Integrated Monetary Area (CIMA) would create a regional payment space in which countries retain their national currencies for domestic use but settle intra-area transactions through a supranational clearing bank and a distinct supranational settlement currency. National Bureaus would link domestic banking systems to this common institution, and payments would be processed through a real-time gross settlement system. This would remove the need to use reserve currencies for transactions within the area. Although no full CIMA yet exists, the proposal builds on national central-bank settlement practices, and the monetary area could be extended to any country that wishes to join. This would reduce dependence on reserve currencies, curb debt accumulation linked to net imports, stabilize exchange relations, and widen space for industrial policy, employment, public investment, and regional development. It would also make regional integration more symmetrical by preventing monetary dominance by any one state. CIMA supports poverty eradication beyond growth by expanding fiscal and developmental space, reducing external and monetary pressures, and redistributing power away from the reserve-currency hierarchy toward a more cooperative and sovereign regional order.
Thus, financing universal basic services beyond extractive growth requires debt justice to restore fiscal space that would allow governments to safeguard social protection floors and maintain essential public services, in addition to rejecting austerity as a condition for debt relief.
